Canada Customs and Revenue Agency is getting increased policing power over tax shelters, according to Tuesday’s federal budget.
The existing definition of a tax shelter in the Income Tax Act allows the promotion of tax deductions against income.
The budget has expanded the definition to include the promotion of shelters that provide tax credits. For example, a shelter promoting tax credits for art donations to cultural institutions would come under the new definition. This will apply to property acquired and gifts, contributions and representations made after Feb. 18, 2003.
Tax shelter promoters must obtain a tax shelter identification number before they begin selling. The ID number facilitates CCRA audits — examining a tax shelter to see whether it entitles potential purchasers to legitimate tax benefits.
New power over tax shelters for CCRA
Ottawa amends definition to include promotion of tax credit schemes
- By: Stewart Lewis
- February 18, 2003 February 18, 2003
- 18:05
Stewart Lewis